1st Ministerial Meeting on the Economy
Deputy Prime Minister Kim Dong Yeon presided over this year’s 1st Ministerial Meeting on the Economy, held on January 11, and discussed plans to boost the KOSDAQ market and promote venture capital, and stressed the importance of raising minimum wages in pursuit of income-led growth.
The following is a summary of Deputy Prime Minister Kim’s keynote address:
Boost KOSDAQ market to promote venture capital
The government has been working for the administration’s ‘growth through innovation’ to be felt by the Korean people. In this respect, we will discuss ways to boost the KOSDAQ market as it can be the place where innovative venture startups can be financed properly and grow. The government will work to make the KOSDAQ market properly finance innovative ventures and develop itself into a more sound and trustworthy market for investors.
Help the minimum wage increase properly work for the economy
The minimum wage increase is the most important idea upon which the administration’s income-led growth has been based, as well as its ‘people-first’ economy. When successfully implemented, the minimum wage increase will boost domestic demand, creating a virtuous cycle of high investment-high growth-high employment, and will finally lead to stronger fundamentals of the economy.
It turned out that a slowdown in service sector job data for December 2017 was due to a high base effect and a lack of fiscal expenditures at the end of the fiscal year. There is a possibility of the job market being affected by the minimum wage increase as in the past when the minimum wage rose by 16.6 percent in 2000 and 12.3 percent in 2007. However, a slowdown was temporary. At the beginning of this year, the economy may see a temporary slowdown in the job market, but it will recover fast as we are well prepared for rising burdens on small businesses. Our support for small businesses includes
- wage support of 3 trillion won, which have launched on January 2, 2018
- strengthened support for social insurance payment, which rises in line with minimum wage increases
- business management support worth 1 trillion won, which aims to help small businesses increase their management efficiency through 76 projects
Demand for the support will begin to rise later this month when this year’s first paycheck is given, and the government will examine the cases and work to better manage the support.
Please refer to the attached pdf